10/17/2005

Port may use eminent domain to take land from Mar Com: The Oregonoan, 10/15/05

No deal The one-time ship repair firm says the offer of $1.2 million for five-plus Willamette River acres is lowBy Alex Pulaski

The Port of Portland, unable to reach agreement to buy a Willamette River industrial property, may use its eminent domain power to take the land.

Port commissioners agreed last month to authorize condemnation proceedings against Mar Com Holding Inc., owner of five-plus acres between the Port's Terminal 4 and the St. Johns Bridge.

Mar Com was part of Portland's shipbuilding trade until October 2003, when, caught between shrinking orders and increasing environmental costs, it shut its doors and left 70 to 80 employees out of work.

Though both sides said they would to try to reach a deal, the negotiations pit Mar Com against an institution that contributed to its demise.

In 2000, the Port sold its 57-acre shipyard on Swan Island to shipbuilder Cascade General for $30.8 million.

Mar Com's owner, Tom Maples, and others protested then that the price was too low and that the Port was subsidizing one competitor. The following year, Cascade General sold its biggest drydock to a company in the Bahamas for $25 million.

Until the shipyard was sold, Mar Com was performing ship and boat repair in leased spaced there and in Vancouver. The company bought the property next to Terminal 4 in the mid-1990s and invested about $1 million in its drydock.

In the late 1990s, the West Coast's ship repair jobs began to dry up. Countries with Third World wages, nonunion laborers and few environmental rules won the work.

Later, Mar Com faced increasing environmental costs as the state and federal governments increased scrutiny of a six-mile stretch of the Willamette known as Portland Harbor. The area was listed as a federal Superfund site in 2000.

The Port says the Mar Com property would allow for expansion of Toyota's auto-import operation at Terminal 4. Though the Port's container business is struggling, its car operations are booming. Toyota imports through Portland are up 11.6 percent from a year ago, to 110,184 vehicles through August.

Port documents indicate it also intends to obtain 1.1 acres of filled land fronting the Mar Com acreage, either from the state, which owns it, or from Mar Com, which holds a purchase right.

The Port's evaluation of the property concluded it would have to spend $25,000 to clean up grit piles and contaminated soil. The agency intends to avoid the site's Superfund liability by not taking ownership of any land under water.

Eric Hedaa, a Port spokesman, said the Port commission had authorized condemnation proceedings only twice in recent memory: for West Hayden Island in 1992 and for disposal sites for the Columbia River channel dredging begun this year. Hedaa said the Port did not use the condemnation authority in either case.

The Port has offered Maples $1.2 million for the property.

Maples would not comment on his asking price or the Port's offer, other than to say "that's not fair market value."

He said he had two buyers willing to pay more than what the Port is offering.

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